CGI Gets Govt Contract Despite Obamacare Website Glitches

CGI Federal, a subsidiary of CGI Group Inc. (NYSE:GIB) (TSE:GIB), the information technology company based in Montreal, Canada and the contractor behind the failed rollout of the Obamacare website or HealthCare.gov was chosen as a prime contractor by the General Services Administration (GSA).

CGI can compete for projects worth billions of dollars

The Montreal-based information technology company is a prime contractor under a new vehicle contract known as One Acquisition Solution for Integrated Services (OASIS). CGI Group Inc. (NYSE:GIB) (TSE:GIB) is allowed bid for billions of dollars in complex professional services task orders across all the agencies of the United States federal government. OASIS is a multi-award contract with unlimited ceiling.

In a statement, Dr. James Peake, Lt. Gen. (Ret), president of CGI Federal said, “We are proud of GSA’s selection of CGI. It is a true reflection of our successful past performance delivering high-quality professional services to our clients. We are eager to begin implementing our innovative solutions under the OASIS vehicle in support of all missions across the Federal government.”

CGI is one of the 74 prime contractors under OASIS

CGI Federal is one of the 74 prime contractors under the OASIS, an indefinite delivery indefinite quantity (IDIQ) contract. The contractors are allowed to compete on a range of program management, management consulting, financial management, logistics, scientific and engineering services. They are also allowed to offer technology services as an ancillary service.

According to CGI Group Inc. (NYSE:GIB) (TSE:GIB), the OASIS will become a critical solution of choice for federal government agencies including the U.S. Air Force, which already signed an agreement with the GSA to use the contract for professional services.

Timothy J. Hurlebaus, a business unit leader for national security and defense programs, and senior vice president at CGI Federal said, “We are looking forward to serving our clients through the OASIS vehicle, with continued support to our U.S. military, including the U.S. Air Force and U.S. Army.” He added, “While the OASIS vehicle will be a vehicle of choice across the government, we expect to be a continued partner of choice for critical services and solutions for our clients.”

CGI Group Inc. (NYSE:GIB) (TSE:GIB) is also one of the prime contractors under the Alliant vehicle.

Accenture replaced CGI as main contractor of Obamacare website

Last year, CGI Group Inc. (NYSE:GIB) (TSE:GIB) was in hot water after the supposed October 1 launching of the HealthCare.gov was delayed due to technical glitches that prevented people from completing their applications for health insurance.

The United States government chose Accenture Plc (NYSE:ACN) to replace CGI Group Inc. (NYSE:GIB) (TSE:GIB) as the main contractor for the Obamacare website.

Jim Chanos and other short sellers bet against CGI

Jim Chanos and other short sellers bet against CGI Group Inc. (NYSE:GIB) (TSE:GIB). In a note to clients in December, Chanos explained that the Montreal-based information technology company has a lot to fall citing the reason that its cash flow is declining—a red flag that requires further scrutiny. He also criticized CGI’s accounting strategy.